[Introduced January 14, 1998; referred to the Committee
on Government Organization; and then to the Committee on
Finance.]

____________

A BILL to amend and reenact sections thirty-eight, thirty-nine,
forty and forty-one, article three, chapter five-a of the
code of West Virginia, one thousand nine hundred thirty-one,
as amended, all relating to leases of buildings, grounds,
offices or other space by the state; requiring the state to
award lease to vendor with the lowest competitive bid;
promulgation of rules; providing an administrative procedure
to be used by the state when leasing property from private
vendors; and criminal penalties.

Be it enacted by the Legislature of West Virginia:
That sections thirty-eight, thirty-nine, forty and
forty-one, article three, chapter five-a of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted, all to read as follows:

ARTICLE 3. PURCHASING DIVISION.

§5A-3-38. Leases for space to be made in accordance with
article; exception.Notwithstanding any other provision of this code, noA
department, agency or institution of state government shallmay
not lease, or offer to lease, as lessee, any grounds, buildings,
office or other space except in accordance with this article.
Provided, That the provisions of this article except as to office
space shall not apply in any respect whatever to the division of
highways of the department of transportationA lease, or offer
to lease, any grounds, buildings, office or other space on behalf
of the state shall be based on competitive bids.§5A-3-39. Leasing of space by secretary; delegation of
authority.
The secretary is authorized to lease, in the name of the
state, any grounds, buildings, office or other space required by
any department, agency or institution of state government:
Provided, That the secretary may expressly delegate, in writing,
the authority granted to him by this article to the appropriate
department, agency or institution of state government when the
rental and other costs to the state do not exceed the sum
specified by regulationof five thousand dollars in any one fiscal year or when necessary to meet bona fide emergencies
arising from unforeseen causes.

The secretary shall have sole authorityis authorized to
select and to acquire by contract or lease, by competitive bid,
in the name of the state, all grounds, buildings, office space or
other space, the rental of which is necessarily required by any
spending unit, upon a certificate from the chief executive
officer or his designee of saidthe spending unit that the
grounds, buildings, office space or other space requested is
necessarily required for the proper function of saidthe spending
unit, that the spending unit will be responsible for all rent and
other necessary payments in connection with the contract or lease
and that satisfactory grounds, buildings, office space or other
space is not available on grounds and in buildings now owned or
leased by the state. The secretary shall, before executing any
rental contract or lease, determine the fair rental value for the
rental of the requested grounds, buildings, office space or other
space, in the condition in which they exist, and shall contract
for or lease said premises at a price not to exceed the fair
rental value thereof
The secretary is hereby authorized to enter into long-term
agreements for leases of buildings, land and space for periods
longer than one fiscal year: Provided, That suchthe long-term
lease agreements shall not beare not for periods in excess of
forty years, except that the secretary may, in the case of the
adjutant general's department, enter into lease agreements for a
term of fifty years or a specific term of more than fifty years
so as to comply with federal regulatory requirements, and shall
contain, in substance, all the following provisions: (1) That
the department of administration, as lessee, shall have the right
to cancel the lease without further obligation on the part of the
lessee upon giving thirty days' written notice to the lessor,
suchthe notice being given at least thirty days prior to the
last day of the succeeding month; (2) that the lease shall be
considered canceled without further obligation on the part of the
lessee if the state Legislature or the federal government should
fail to appropriate sufficient funds thereforto pay for the
lease or should otherwise act to impair the lease or cause it to
be canceled; and (3) that the lease shall beis considered
renewed for each ensuing fiscal year during the term of the lease
unless it is canceled by the department of administration before
the end of the then current fiscal year.
A spending unit which is granted any grounds, buildings, office space or other space leased in accordance with this
section may not order or make permanent changes of any type
thereto, unless the secretary has first determined that the
change is necessary for the proper, efficient and economically
sound operation of the spending unit. For purposes of this
section, a "permanent change" means any addition, alteration,
improvement, remodeling, repair or other change involving the
expenditure of state funds for the installation of any tangible
thing which cannot be economically removed from the grounds,
buildings, office space or other space when vacated by the
spending unit.

§5A-3-41. Leases signed by secretary or director; approval as to
form and filing.

Leases and other instruments for grounds, buildings, office
or other space shall be signed by the secretary or director in
the name of the state. They shall be approved as to form by the
attorney general. A lease or other instrument for grounds,
buildings, office or other space that contains a term, including
any options, of more than six months for its fulfillment shall be
filed with the state auditor.(a) The director shall adopt and amend rules to:(1) Prescribe the amount of deposit or bond to be submitted
with a bid and the amount of deposit or bond to be given for the faithful performance of a lease;(2) Prescribe a system for the director to give notice to
vendors requesting notice of all bid solicitations for leases.
A fee not to exceed the cost of giving the notice to the vendor
may be charged: Provided, That the fee may not exceed forty-five
dollars in one fiscal year;(3) Apply and enforce standard specifications for leases;(4) Suspend the right and privilege of a vendor to bid on
state leases when the director has evidence that the vendor has
violated any of the provisions of this article or the rules of
the director.(b) The director shall examine the provisions and terms of
every lease entered into for and on behalf of the state of West
Virginia that impose any obligation upon the state to pay any
sums of money and approve each lease with respect to the
provisions and terms of the lease. The duty of examination and
approval by the director does not supersede the responsibility
and duty of the attorney general to approve contracts as to form
and the director shall assure that the specifications and
descriptions in all "requests for quotations" are prepared so as
to permit all potential lessor-vendors who can meet the
requirements of the state an opportunity to bid and to assure
that the specifications and descriptions do not favor a particular vendor. If the director determines that any
specifications or descriptions as written favor a particular
vendor or if it is decided, either before or after the bids are
opened, that a lease having different specifications or quality
can be entered into, the director may rewrite the "requests for
quotations" and the matter shall be rebid.(c) Bids shall be based on the standard specifications
promulgated and adopted in accordance with the provisions of this
section and shall not be altered or withdrawn after the appointed
hour for the opening of such bids. All leases based on
advertised bid requests made by the director or by a state
department shall be awarded to the lowest responsible bidder,
taking into consideration the qualities of the buildings,
structures, grounds or property involved, conformity with
specifications, suitability to the requirements of the government
and the lease terms. All bidders submitting bid proposals to the
director are required to submit an extra or duplicate copy to the
state auditor.Both copies must be received at the respective offices prior
to the specified date and time of the bid openings. The failure
to deliver or the nonreceipt of these bid forms at either of
these offices prior to the appointed date and hour are grounds
for rejection of the bids. In the event of any deviation between the copies submitted to the director and the state auditor, the
bids as to which there is a deviation shall be rejected, if the
deviation relates to the quality or specifications of the
proposed lease property or to the cost of the lease or to the
date of delivery or performance. After the award of the lease,
the director, or someone appointed by him for that purpose, shall
indicate upon the successful bid and its copy in the office of
the state auditor that it was the successful bid. Thereafter,
the copy of each bid in the possession of the director and the
state auditor shall be maintained as a public record by both of
them, shall be open to public inspection in the offices of both
the director and the state auditor and shall not be destroyed by
either of them without the written consent of the legislative
auditor. If the director permits bids by facsimile transmission
machine to be accepted in lieu of sealed bids, a duplicate
facsimile transmission machine bid shall be transmitted to the
state auditor pursuant to this section: Provided, That an
original bid is received by the state auditor within two working
days following the date specified for bid opening.(d) The director shall not accept any bid received from any
vendor unless the vendor has paid the annual fee established by
rule promulgated by the director and has filed with the director
an affidavit of the vendor or the affidavit of a member of the vendor's firm, or, if the vendor is a corporation, the affidavit
of an officer, director or managing agent, of such corporation,
disclosing the following information:(1) If the vendor is an individual, his name and residence
address, and, if he has associates or partners sharing in his
business, their names and residence addresses;(2) If the vendor is a firm, the name and residence address
of each member, partner or associate of the firm;(3) If the vendor is a corporation created under the laws of
this state or authorized to do business in this state, the name
and business address of the corporation; the names and residence
addresses of the president, vice president, secretary, treasurer
and general manager, if any, of the corporation; and the names
and residence addresses of each stockholder of the corporation
owning or holding at least ten percent of the capital stock
thereof;(4) A statement of whether the vendor is acting as agent for
some other individual, firm or corporation, and if so, a
statement of the principal authorizing such representation shall
be attached to the affidavit or whether the vendor is doing
business as another entity;(5) The vendor's latest Dun & Bradstreet rating, if there is
any such rating as to such vendor; and(6) A list of one or more banking institutions to serve as
references for such vendor.Whenever a change occurs in the information heretofore
submitted as required, such change shall be reported immediately
in the same manner as required in the original disclosure
affidavit.The affidavit and information so received by the director
shall be kept in a register of vendors which shall be a public
record and open to public inspection during regular business
hours in the director's office and made readily available to the
public at such time.The director may waive the above requirements in the case of
any corporation listed on any nationally recognized stock
exchange and in the case of any vendor who or which is the sole
source for the commodity in question.Any person who makes such affidavit falsely or who knowingly
files or causes to be filed with the director, an affidavit
containing a false statement of a material fact or omitting any
material fact, is guilty of a misdemeanor, and, upon conviction
thereof, shall be fined not more than one thousand dollars, or
imprisoned in a county or regional jail not more than one year
or both fined and imprisoned. In any such case, an individual so
convicted shall be adjudged forever incapable of holding any office of honor, trust or profit in this state, or of serving as
a juror.

NOTE: The purpose of this bill is to require competitive
bidding on all property to be leased by the state for use
by state agencies. The bill authorizes the Secretary of
Administration to enter into leases with the lowest bidding
vendor for buildings, grounds, offices or other space deemed
necessary or useful for the operation of state agencies. The
director of purchasing is given responsibilities under the bill
to promulgate rules and to ensure that the bidding process is
fair.

Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.